Great ClipsFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Great Clips franchise requires a total initial investment of $188K – $420K, including a $20K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $399K[2]. SBA 7(a) loans show a 5.3% charge-off rate across 604 loans[1]. Verdict grade: A. Run a live ROI scan →
Data last verified June 21, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $188K – $420K
- 18th pct Personal Care…
- Avg gross sales
- $399K
- 9th pct Personal Care…
- Royalty
- 6.0%
- 9th pct Personal Care…
- Units
- 4,439
- 49th pct Personal Care…
- SBA default
- 5.3%
- system-wide median varies by category
Quick verdict · Personal Care & Beauty · color = vs category peers
Green = >15% above Personal Care & Beauty avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Franchising since 1983. Systems this mature have refined operations and brand recognition.
27% cash-on-cash return (based on Cash Flow). Within the 15-30% range most franchise investors consider acceptable.
Large franchise systems benefit from brand recognition, supply chain leverage, and proven operations.
Bottom line
- Total investment $188K – $420K including a $20K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $399K/year (median $382K), with an estimated 27% cash-on-cash return (based on Cash Flow).
- Verdict A (Top Quintile) with a risk score of 22/100. SBA loan charge-off rate of 5.3% across 604 loans (near or below the 16% franchise average, based on all SBA 7(a) franchise lending, 2010–2024).
- Established system with 4,439 units across 43 years of franchising. Strong brand recognition and operational playbook.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Great Clips, Inc.
- Incorporated in
- MN
- HQ
- 4400 West 78th Street, Suite 700, Minneapolis, MN 55435
- Auditor
- RSM US LLP
- Audited financials
- Franchisor revenue
- $179.8M
- vs $193.6M prior year
Overview
About
Great Clips franchisees operate budget-focused hair salons providing quick haircuts, typically in high-traffic retail locations. Day-to-day operations involve scheduling appointments, managing 3-8 stylists, inventory control (shampoo, towels, tools), customer service, and maintaining brand standards for walk-in traffic predominantly from price-conscious customers seeking 20-30 minute haircuts.
- CEO
- Robert D. Goggins
- Headquarters
- MN
- Founded
- 1982
- FDD year
- 2025
- States available
- 51
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $20K | $20K |
| Working capital (3–6 mo) | $20K | $60K |
| Equipment, build-out, other | $148K | $340K |
| Total initial investment | $188K | $420K |
Source: Great Clips 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$76K
19.0% margin
Unlevered ROIC
22%
EBITDA / total invested capital
Payback
4.5 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $188K – $420K
- Better than avg vs category
- Liquid capital req'd
- $20K – $60K
- Better than avg vs category
- Franchise fee
- $6K – $20K
- Better than avg vs category
- Royalty
- 6.0%
- Gross Sales · typical 6–8%
- Ad fund
- 5.0%
- typical 3–5%
- Total fee load
- 11.0%
- vs 9–13% typical
- Payback period
- 3.7 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 5.0% of gross sales |
| Technology fee | $250 |
| Transfer fee | $2K |
| Renewal fee | $2K |
| Total fee load | 11.0% of rev |
Financial Performance
- Avg gross sales
- $399K
- Per unit, per year
- Median gross sales
- $382K
- Avg cash flow
- $83K
- Reported as Cash Flow in FDD Item 19
- Cash-on-cash
- 27.2%
- Based on Cash Flow / investment midpoint
- Item 19 type
- Average and Median Sales, Expenses, and Operating Cash Flow
- Sample size
- 4147 units
- vs category median 35 · large
- Range (low → high)
- $38K→$1.1M
- Cohort dispersion (min → max)
- Transparency
- 10 / 5
- vs category median 4 / 5 · above
Compared against 186 Personal Care & Beauty brands
vs Personal Care & Beauty averages
How Great Clips Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 4,439
- Opened
- 115
- Last reporting year
- Closed
- 98
- Turnover rate
- 2.2%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (yr3)
- +0.3%
- Net unit change last year
- 3-yr CAGR
- +0.3%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 207
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 51 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 604
- Loan volume
- $126.0M
- Median loan
- $120K
- 50th percentile
- Charge-off rate
- 5.3%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 94.7%
- 5-yr charge-off
- 4.3%
- Loans approved 2021+
- Active lenders
- 132
- Defaults
- 27
Vintage analysis
Great Clips charge-off rate by loan vintage
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Great Clips's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 35-year lending trend
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Great Clips presents moderate-to-cautionary risk: a mature, stagnant franchise system with unverified financials, thin margins, and limited growth prospects despite stable brand recognition.
Audited financials (Item 21)
Yes · RSM US LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 22 / 100 rating
- 01MINORSystem stagnation: 4,439 units with only 0.3% YoY growth indicates mature/declining market with minimal expansion opportunity
- 02MINORNo Item 19 financial disclosure: Average revenue of $399,179 and net income of $82,637 are unverified estimates, making ROI projections unreliable
- 03MINORThin profit margins: 20.7% net margin leaves little room for error; 6% royalty ($23,951 avg annual) plus operating costs create vulnerability to economic downturns
- 04MINORHigh entry cost relative to returns: $187,800-$419,900 investment against $82,637 avg net income yields 2-4 year payback with execution risk
- 05MINORCommoditized service model: Low-cost haircut category faces Amazon-style disruption (mail-in clipper kits, DIY trends, budget competitors)
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Territory type | Radius |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 1 year |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Litigation count | 0 |
Items 10, 11
Training & Operations
- Classroom training
- 49 hrs
- On-the-job training
- 13 hrs
- POS system
- Styleware
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Styleware
Item 20 · call current owners
Franchisee Contacts
4,790 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Great Clips · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Great Clips franchise?
The total investment to open a Great Clips franchise ranges from $188K – $420K, with an initial franchise fee of $20K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Great Clips franchise owners earn?
According to Item 19 of the Great Clips FDD, the average gross sales per unit is $399K. The median is $382K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Great Clips's franchise failure rate?
Based on SBA 7(a) loan data, Great Clips has a charge-off rate of 5.3% across 604 loans, meaning 5.3% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many Great Clips franchise locations are there?
As of their most recent FDD filing, Great Clips has 4,439 total units in the United States, including 4,427 franchised units and 0 company-owned units. 115 new units were opened in the latest reporting year.
Is Great Clips a good franchise to buy?
FranchiseVerdict rates Great Clips as a A-grade franchise with a risk score of 22 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.